In last week’s advisory, I talked about the most common consumer scams taking place across America so that members of the Self-Reliance Institute can be on-guard against those scams and warn their family and friends.
This week, I’d like to warn members of the Institute about two particularly aggressive forms of identity theft and fraud that are spiking right now.
The first is a tax fraud scam. And given that it’s the time of year when we all sit down to prepare and file our taxes, it may not be all that surprising that identity thieves and fraudsters are trying to take advantage of the fact that most everyone is thinking about taxes right now.
While there are many schemes that identity thieves and fraudsters use to commit tax fraud and identity theft – the most common is filing false tax refund claims in the name of victims – there’s a more direct method taking place as I write this advisory.
In fact, J. Russell George, the Treasury inspector general for tax administration, is calling this scheme “the largest scam of its kind that we have ever seen.”
Here’s how it works.
The victim gets a call from an individual claiming to be from the Internal Revenue Service. The IRS “agent” claims the victim owes back taxes and must pay right away or else the victim will be arrested. (In other variations, the “agent” threatens the loss of a business or driver’s licenses or even deportation from the country.)
The “agent” then tells the victim that to avoid arrest they must pay immediately by using a pre-paid debit card or wire transfer.
To date, the IRS reports that more than 20,000 people have reported this fraud scheme and victims have paid more than $1 million dollars to the tax fraudsters.
So please remind your family and friends that the IRS would never call you by phone and demand immediate payment. And to stay up-to-speed on other forms of tax fraud and report fraud to the IRS, you can bookmark this Tax Fraud Alerts web page at the IRS by clicking HERE.
Now let’s talk about Medical Identity Theft.
I’ve been investigating, consulting and testifying before Congress about identity theft since 1998. When I first started, medical identity theft was almost unheard of and rarely took place. But, it did exist and I constantly warned in my public testimonies that I believed medical identity theft would grow.
I’m sorry to say I was correct.
Here’s what Adam Levin reported this week at Credit.com and was reprinted at MarketWatch.com.
“If recent disclosures regarding the massive wave of breaches suffered by retailing icons Target, Neiman-Marcus and Sally Beauty haven’t scared you enough, try to wrap your brain around the new Ponemon Institute Patient Privacy and Data Security study. The study has found a 100% increase in criminal attacks on health care organizations since 2010. But if that weren’t enough, they also found something far more disturbing.
“’Despite concerns about employee negligence and the use of insecure mobile devices, 88 percent of organizations permit employees and medical staff to use their own mobile devices such as smartphones or tablets to connect to their organization’s networks or enterprise systems such as email. Similar to last year more than half of (these) organizations are not confident that the personally-owned mobile devices or BYOD are secure.’
“According to the report, very few organizations require their employees to install anti-virus/anti-malware software on their smartphones or tablets, scan them for viruses and malware, or scan and remove all mobile apps that present a security threat before allowing them to be connected their networks or systems. …
“What should concern you about these findings (and several others in the report) is that assaults on health care systems don’t simply create the potential to have credit cards stolen or checks redirected: it’s that hackers are getting access to your health care data (“protected health information,” or “PHI” in regulatory speak), and the real world consequences of that are far more devastating.”
Now get this.
“Medical identity theft is on the rise, just as the rise in criminal breaches of health care providers is spiking. Medical identity theft accounted for 43% of all identity theft reported in 2013, and the U.S. Department of Health and Human Services estimates that somewhere between 27.8 and 67.7 million people’s medical records have been breached since 2009 (and that’s before the flawed rollout of the Affordable Care Act).”
Read those statistics again.
–Medical identity theft accounted for 43% of all identity theft reported in 2013.
–Between 27.8 and 67.7 million people’s medical records have been breached since 2009.
Folks that’s, pardon the pun, an epidemic of medical identity theft.
And, in my opinion, it’s all because of a deeply flawed medical records system that is now being worsened by the Affordable Care Act – also known as ObamaCare.
Further, you and I can’t count on the government or the health care industry to fix this problem.
So before I sign off for this week, let me ask you a few questions so that next week I can share information on how to combat both tax fraud/identity theft and medical identity theft.
Have you ever been a victim (or know someone who has) of tax fraud or tax identity theft?
Have you ever been a victim (or know someone who has) of medical identity theft?
Do your health care providers have your Social Security Number?
Do you know what a Credit Freeze is?
Do you have a Credit Freeze in place on your accounts?
You can email me at [email protected] with your answers (I’ll keep them anonymous as always!!) and next week we’ll discuss proactive steps to fight tax fraud/identity theft and medical identity theft.
Until then, be safe and secure and share this information with your family and friends!